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European Commission

Press release

Brussels, 11 March 2014

State aid: Commission approves German regional aid map 2014-2020

The European Commission has approved Germany's map for granting regional state aid between 2014 and 2020 within the framework of the new regional aid guidelines adopted by the Commission in June 2013 (see IP/13/569). The new guidelines set out the conditions under which Member States can grant state aid to businesses for regional development purposes. They aim to foster growth and greater cohesion in the Single Market.

A regional aid map defines the regions of a Member State eligible for national regional investment aid under EU state aid rules and establishes the maximum aid levels (so-called "aid intensities") for companies in the eligible regions. It will be in force between 1 July 2014 and 31 December 2020.

The designated areas have a total population of 21.1 million or 25.85 % of Germany's population. The decision also sets the maximum levels of aid that can be granted to regional investment projects carried out by large enterprises in the assisted areas at between 10% and 20% of total investment costs, depending on the area concerned. For investments carried out by SMEs, these percentages can be increased.

Commission Vice-President in charge of competition policy Joaquín Almunia said: “The approved regional aid map for Germany supports our cohesion policy and contributes to the Commission's State Aid Modernisation agenda aiming to foster well-targeted, more effective state aid. Germany will now be able to organise a smooth transition from the current regional aid system towards its regional development strategy for 2014-2020.''

Under the regional guidelines, areas which have a GDP per capital below 75% of the EU average are eligible in priority for regional investment aid, as the main purpose of regional aid is to foster the development of the less advantaged regions of Europe. While for the period 2007-13, almost the entire territory of the German new Länder (following the reunification of Germany) fell within this category, none of the German regions qualify for this status for the 2014-2020 period. In order to ensure a smooth transition, these areas will continue to be eligible until 2020 and the maximum aid intensities applicable in these regions will be reduced by the end of 2017.

Under the guidelines, other regions can also be made eligible provided that they comply with certain criteria, in order to allow Member States to tackle their own regional disparities. As these regions are less disadvantaged from a European perspective than areas with a GDP per capita below 75% of the EU average, both the geographical scope and the aid intensity are strictly limited. The regional map specifies what areas have been made eligible by Germany.

The maximum aid intensities for regional investment aid in the German assisted regions have slightly decreased as compared to the previous aid map (between 5 and 15 percentage points, depending on the region).

Background

The regional aid guidelines set out the rules under which Member States can grant state aid to companies to support investments in new production facilities in the less advantaged regions of Europe, or to extend or modernise existing facilities. The ultimate purpose of regional state aid is to support economic development and employment. The regional aid guidelines contain rules on the basis of which Member States can draw up regional aid maps valid throughout the guidelines' period of validity. The maps identify in which geographical areas companies can receive regional state aid and at what proportion of the eligible investment costs (aid intensity). Eligible costs are the part of the total investment costs that may be taken into account for the calculation of the aid.

Article 107(3)(a) of the Treaty on the Functioning of the European Union (TFEU) allows Member States to grant state aid to promote the economic development of areas where the standard of living is abnormally low or where there is serious underemployment. The regional aid guidelines define these areas as regions with a GDP per capita below 75 % of the EU average and outermost Regions. Moreover, in order to ensure a smooth transition, regions that were previously below the threshold of 75% of EU GDP will continue to be pre-defined at EU level as eligible for regional aid. In the German case, the aid intensities for these regions will decrease by the end of 2017 to the aid intensity levels for regions supported under Article 107(3)(c).

Article 107(3)(c) TFEU allows regional state aid to facilitate the development of certain economic activities or of certain economic areas where it does not adversely affect trading conditions to an extent contrary to the common interest. The regional aid guidelines define these as areas of a Member State which are disadvantaged either in relation to the EU average, or in relation to the national average. The population coverage is distributed between Member States according to socioeconomic criteria which take into account regional disparities, including unemployment, at both EU and national levels. It is then for each Member State to decide in its regional map how to best use this room for manoeuvre to define more eligible area in order to address its internal regional disparities.

The non-confidential version of today's decision will be made available under the case number SA.37423 in the State Aid Register on the DG Competition website once any confidentiality issues have been resolved. New publications of state aid decisions on the internet and in the Official Journal are listed in the State Aid Weekly e-News

Contacts :

Antoine Colombani (+32 2 297 45 13, Twitter: @ECspokesAntoine )

Olga Leszczynska-Vargin (+32 229-65520)


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